Are Employee Benefits a Legal Requirement?

The appeal for employees to leave to start their own business or become a freelancer is overwhelmingly high. So rather than incur high recruitment fees or lose their best staff, companies are constantly looking for ways to incentive their employees and using bespoke employee benefit schemes is offering a real-life solution.

Besides a few basic employee benefits all employers must provide, employee benefits are not a legal requirement for companies to implement, but they have quickly become an essential for many start-ups, SMEs and large organisations in the UK. Common employee benefit programs include discounts, freebies, parenting classes, healthcare, pensions and more.

Employee benefits are now a multi-billion-pound business in the UK and have been proven to increase staff participation, reduce absenteeism, improve productivity and retain staff for longer. Let’s take a look at what these benefits can look like and why they are helpful.

Types of employee benefits


Portals such as Xexec and Perkbox offer discounts on a wide range of consumer products and discounts through their online portals. New incentives, discounts and products can be added to the portal on a regular basis and can offer different incentives based on the position in the company or number of staff.

The product is available for every employee for just a few pounds per month (or cheaper if you buy in bulk) and the most popular benefits include savings on cinema tickets, Deliveroo, Apple, gifts and more.


Offering business healthcare packages is not new and is incredibly common in the US. But as an employee benefit scheme, it is a relatively new concept.

The idea is that you can give staff access to private healthcare and they save a lot of time but not having to go through the NHS – and this should make them healthier and happier when they work.

Since private health insurance can be such a big advantage, it is certainly something that will retain staff – and this is why is has taken off in the US.

Depending on the level of cover, you may only get GP access or a set number of physio or dental appointments per month (similar to a health cash plan). But if you extend to higher level packages, it often includes things like diagnostic treatment, hospital treatment and inpatient stays too.

Equipsme offer staff health insurance from £7 per person, per month – and policyholders can include their children on the policy for half price.

Life insurance

Life insurance is a luxury for many but is essential for any staff or individuals that have families and children. In the event of death or critical illness, a life insurance policy will typically pay out a lump sum to the family of the deceased. This income is designed to help cover the individual’s lost income and pay for mortgage repayments, schooling, travel and ongoing household bills.

For organisations, offering life insurance for staff members shows your interest and care for the wellbeing of the individual.

At yulife, group policies are available from £4.99 per month and beyond the policy, there is an app which offers rewards for completing physical and mental wellbeing tasks. Participants are rewarded with vouchers and discounts for fulfilling tasks such as meditation, jogging and doing breathing exercises.

Can the employee legally keep the benefit when they leave the company?

This depends whether the employee benefit is included in the employee contract and whether there are unequivocal terms. An employer can rarely change terms with your consent.

Some benefits might be deemed ‘non contractual’ – in which case the employer can withdraw them at any time and if you leave the company.

Some benefits might be deemed ‘non contractual’ – in which case the employer can withdraw them at any time and if you leave the company.

If the benefit has come as an implied term of contract, the employer may keep it.

Some benefits such as pensions are ones that you take with you when you leave, because you have made contributions.

Others such as life and health insurance are typically void once you leave, however you can ask your employer if you can take this with you and you simply continue paying the fees yourself.

Overall, it depends on the employer and type of benefit offered, but it is something that you should clarify from the onset.

So while none of the above are legal required as part of a company contract, and no employer is legally obliged to offer any of these, they are slowly becoming the status quo among most companies and larger organisations, as they have proven to better staff retention, boost productivity and incite value in employees, resulting in better morale and better results.

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